The FDCPA, Debt Collection Practices, and Consumer Privacy

The Fair Debt Collection Practices Act or FDCPA is a federal consumer protection law that was enacted by the U.S. Congress in 1977. The FDCPA established various legal protections for American consumers as it relates to abusive debt collection practices. The purpose of the FDCPA was to “eliminate abusive practices in the collection of consumer debts, to promote fair debt collection, and to provide consumers with an avenue for disputing and obtaining validation of debt information in order to ensure the information’s accuracy.” To this end, the FDCPA created legal guidelines that debt collectors must adhere to when looking to collect debts from American consumers. Moreover, the law also defines the rights that Americans consumers have as it pertains to debt collection.

What are the provisions of the FDCPA?

Under the FDCPA, debt collectors are required to fulfill a number of obligations and requirements when looking to collect a debt from an American consumer. For instance, the FDCPA mandates that debt collectors must provide American consumers with basic information when seeking to collect a debt. Such basic information must include the amount of the debt, the name of the creditor to whom the debt is owed, and a notice explaining the consumer in question has thirty days to dispute the debt before it is assumed to be valid, among other pertinent details. To this end, if a consumer chooses to dispute the debt, debt collectors must also mail said consumer the verification or cease all efforts to collect the debt altogether.

In addition to regulating the conduct of debt collectors when said parties are seeking to validate and collect debts, the FDCPA also prohibits certain actions and behaviors with respect to debt collection attempts. Under the FDCPA, a debt collector is forbidden from harassing, oppressing, or abusing an American consumer when looking to collect a debt. More specifically, the following actions and behaviors are prohibited:

• Using or making threats of violence or other criminal acts to physically harm the person, their reputation, or their property.
• Using profane, obscene, or other explicit or offensive forms of language that abuses the reader or hearer.
• Publishing a list of consumers who are alleged to have not paid their debts, unless the said list is published in accordance with a “consumer reporting agency or to persons meeting the requirements of section 603(f) or 604(3) of the FDCPA.”
• Publicly advertising the debt of a consumer for sale for the purpose of coercing payment.
• Abusing, annoying, or harassing a consumer by “repeatedly calling their telephone number or allowing their telephone to ring continually.”
• Making telephone calls to consumers without proper identification, “except as allowed to obtain location information.”

Furthermore, debt collectors are also prohibited from using false, misleading, or deceptive representations when looking to collect a debt. More specifically, the FDCPA outlaws the following actions in relation to debt collectors:

• Falsely representing the amount, character, or legal status of a particular debt, as well as any of the services rendered, or the compensation that a debt collector stands to receive for successfully collecting the debt.
• Falsely representing that they are an attorney or that their communications have been made in connection with an attorney.
• Threatening to take any legal action against a consumer that is not legal or intended.
• Falsely representing or implying that they operate or are employed by a consumer credit reporting agency.
  Using any name that is not the true and accurate name of their business, company, or organization.
• Failing “to disclose in the initial written communication with the consumer, and the initial oral communication if it precedes the initial written communication, that the debt collector is attempting to collect a debt and that any information obtained will be used for that purpose. In addition, the debt collector must disclose in subsequent communications that the communication is from a debt collector.”

What are the penalties for violating the FDCPA?

Debt collectors who violate the rights of American citizens under the FDCPA are subject to the following sanctions and punishments:

• Any actual damages that a consumer may sustain as a result of failure to comply with the law.
• Punitive damages as allowed by a court of law, including an individual action of up to $1,000, “up to $1,000 for each named plaintiff and an award to be divided among all members of the class of an amount up to $500,000 or 1 percent of the debt collector’s net worth, whichever is less”, in the case of a class action.
• Any reasonable attorney fees that may be incurred when looking to pursue the legal actions listed above.

Much like the Fair Credit Reporting Act or FCRA and the Truth in Lending Act or TILA, the FDCPA is a legislative means geared towards protecting American consumers from predatory credit-related services. Through the provisions of the FDCPA, debt collectors must ensure that they follow strict regulations and procedures when looking to collect a debt from an American consumer, lest they face monetary penalties and punitive damages. As legitimate debt collection services can be stressful enough, American citizens have the right now to be abused by debt collectors when looking to settle any outstanding balances they may have with a particular creditor or lender.